Republic of Korea – an Energy Snapshot

The Republic of Korea’s energy use per capita is among the highest in the world and it is the world’s eighth-largest consumer of energy, mostly derived from fossil fuels.

The role of natural gas and its integration with renewables development in long-term planning is expected to be critical in achieving a carbon neutral target by 2050 and a reduction of 40% in carbon emissions by 2030 from 2018 levels. The carbon neutral target was enshrined into legislation in 2021.

For decades now, Korea has depended on imports of oil, coal and natural gas for the vast majority of its energy needs and in 2021 those commodities accounted for nearly 85% of energy use. In 2021, it was the third-largest importer of LNG in the world.

A change in government in 2022 saw a continued commitment to 2050 carbon neutrality but a distinct change in the energy mix by which the goal will be achieved – with President Yoon Suk-yeol announcing a reduction in renewable energy targets and a fresh focus on nuclear power as part of the decarbonisation agenda.

In July 2022, the new government revealed a 2030 target of nearly 33% nuclear energy, which had been targeted for phasing out by 2050 by the previous administration. Nuclear plants will also be exported. By contrast, renewable energy – previously identified as an area of rapid growth – will make up only a little more than 21% of Korea’s energy supply.

The new government’s approach will go some way towards addressing questions around how its predecessor’s ambitious renewables goals would be achieved – including growth from 6.5% of the power generation capacity in 2020 (20GW) to 42% in 2034 (78GW).

Natural gas will continue to have a vital role to play in supporting Korean industry and communities. The draft 10^th Basic Plan for Electricity Supply and Demand for 2030-34 forecast gas would make up 22.9% of energy use in 2030, overtaking coal (19.7%) and making up a higher percentage than renewable energy. LNG import capabilities will be expanded and Korea will increasingly look to regions beyond the Middle East for supply, including Australia and the US.

Under the Ninth Basic Plan for Electricity Supply and Demand for 2020-34, 24 of the 60 coal-fired power stations currently under operation were to be converted into natural gas-fired power plants by 2034.

Meeting carbon targets in Korea will require decarbonisation efforts across all energy sectors, removal of regulatory and institutional barriers, introduction of flexible market designs, and deployment of the country’s advanced technologies and innovative capacity. The Green New Deal announced in July 2020 was a significant step towards accelerating the transition. It aims to increase the number of electric vehicles from 90,000 at the end of 2019 to 1.13 million by 2025 and increase the number of hydrogen-powered fuel-cell electric vehicles on Korean roads from the 5,083 sold in 2019 to 200,000.

The Ministry of Land, Infrastructure and Transport in 2019 announced plans to build four pilot hydrogen-powered cities by 2022 with a view to transform 10% of the country’s counties, towns, and cities to hydrogen power by 2030, and 30% of them by 2040. If this vision succeeds, hydrogen will account for 5% of projected power consumption by 2040. The draft 10^th Basic Plan for Electricity Supply and Demand projects hydrogen and ammonia making up 2.1% of the energy mix by 2030.

An updated roadmap towards carbon neutrality for Korea was expected to be published in the first quarter of 2023.

ANGEA is an industry association representing LNG and natural gas producers, energy buyers, suppliers and companies in APAC. Based in Singapore, it works in partnership with governments and societies across the region to deliver reliable and secure energy solutions that achieve national economic, energy security, social and environmental objectives and meet global climate goals.

Photo of Seoul by Ciaran O’Brien on Unsplash